The power behind Andrew Forrest

0
140

John Andrew Henry Forrest AO (born 1961), nicknamed Twiggy, is an Australian businessman. He is best known as the former CEO (and current non-executive chairman) of Fortescue Metals Group (FMG), but also has interests elsewhere in the mining industry and in cattle stations.

With an assessed net worth of A$6.84 billion according to the 2017 Financial Review Rich List, Forrest was ranked within the top ten richest Australians.[2] He was the richest person in Australia in 2008.[4][5] In 2013, Forrest and his wife, Nicola, were the first Australians to pledge the majority of their wealth to charity in their lifetimes.[6] He had earlier stepped down as CEO of Fortescue Metals in 2011 in order to spend more time on philanthropic pursuits.[7] Much of his philanthropy has been through either the Minderoo Foundation (focusing on education and Indigenous Australians) or the Walk Free Foundation (focusing on ending modern slavery), both of which he established. In 2014, Forrest and his wife, Nicola, pledged $65 million over 10 years through the Minderoo Foundation, establishing the Forrest Research Foundation to offer scholarships to students pursuing a PhD at a Western Australian university.[8][9]
Forrest was born in Perth, Western Australia, the youngest of three children of Judith (née Fry) and Donald Forrest.[10] His father, grandfather (Mervyn), and great-grandfather (David) were all managers of Minderoo Station, which David had established in 1878 with his brothers, Alexander and John.[11] John, Alexander, David, and Mervyn were all members of parliament for periods, with John serving as Western Australia’s first premier.[12][13] Forrest’s early years were spent as a jackaroo at Minderoo, located in the Pilbara region south of Onslow.[11] Minderoo was owned by the Forrest family until it was sold in 1998 by his father due to relentless drought and debt,[10] but it was bought back by Forrest in 2009.[14][15]

Forrest was educated at Onslow Primary School[10] and through the School of the Air before moving to Perth to attend Christ Church Grammar School and then Hale School.[16] He stuttered as a child,[10] which is how he came to develop a relationship with Ian Black, whose father Scotty, an Aboriginal,[17] became Forrest’s mentor. Forrest went on to the University of Western Australia[18] where he majored in economics and politics.[19]
Anaconda Nickel
After graduating, he worked as a stockbroker at the brokerage houses Kirke Securities and Jacksons. In his early 30s, he became the founding CEO of Anaconda Nickel (now Minara Resources), which has since grown to be one of Australia’s single largest mineral exporters with its Murrin Murrin Joint Venture nickel project.

Fortescue Metals
In 2003, he took control of Allied Mining and Processing and renamed it Fortescue Metals Group.[20] He is still a major shareholder of FMG, through his private company, The Metal Group.[21] Since then, the company has grown to possess three times the tenements of its nearest rival in Western Australia’s iron ore rich Pilbara region. Fortescue holds major deposits at Mount Nicholas, Christmas Creek, Cloudbreak, and Tongolo. In 2007, he took control of a Niagara Mining, which owns tenements around Laverton, Western Australia.[22] He was nominated as the 2011 Western region Ernst & Young Entrepreneur of the Year.[23]

The Australian Securities and Investment Commission took legal action against FMG and Forrest. Although an initial ruling by Justice John Gilmour[24] in 2009 found Forrest hadn’t acted in a misleading or deceptive manner,[25] Chief Justice Patrick Keane and judges Arthur Emmett and Raymond Finkelstein of the Federal Court of Australia[26] overturned this decision in 2011, finding that FMG and its Chairman and CEO, Andrew Forrest, had engaged in misleading or deceptive conduct and breached the continuous disclosure provisions in the Corporations Act, 2001 (Cth),[27] by claiming to have binding contracts with China.[25] The court found that a Chinese framework agreement does not amount to a binding contract, in the natural meaning of the word.[28] If found to have breached director’s duties, Forrest faces the possibility of being banned as a director of an ASIC-listed company.[29] FMG appealed against the decision,[30] and in October 2012, the High Court found in favour of FMG and Forrest, reversing the decision of the full bench of the Federal Court and agreeing with the original 2009 decision by Justice Gilmour.[31]

Forrest described the Gillard Government proposed Minerals Resource Rent Tax as “economic vandalism”[32] and a “mad dog’s breakfast”[33] that would drive up foreign resource ownership.[34] He stated he would challenge it in the High Court as being unconstitutional, as it discriminates against states, and fails to appropriately capture big producers BHP Billiton and Rio Tinto.[35] WA premier Colin Barnett has stated the state government would back constitutional action,[33] admitting the tax had been suggested to him as a “sovereign risk”. He was highly critical of the government’s expenditure of $38M on an advertising campaign, that was not approved using the usual processes, as it had to “counter mining industry ‘spin’ about the resources super profits tax”.[10] The treasurer Wayne Swan says the big miners will pay at least A$2 billion tax, and wrote to the head of BDO Accounting, who modelled the claims Forrest used, noting they were “utterly unrealistic” and riddled with errors.[36] Treasury concurred that they would be unable to release the assumptions underpinning its forecasts, as they were based on confidential information provided by the big miners.[36] Gillard struck a deal with BHP Billiton, Rio Tinto and Xstrata to develop the MRRT after the failed mining tax under Rudd.[37] Independent MP Andrew Wilkie requested the government take Forrest’s mining tax grievance to heart.[33]

Cattle industry
After buying back the family property, Minderoo Station in 2009 Forrest acquired the adjoining properties, Nanutarra and Uaroo Stations in 2014. Forrest’s total pastoral holdings in the Pilbara was then 7,300 square kilometres (2,819 sq mi).[38] Meat processing company Harvey Beef was acquired by Forrest in 2014 for A$40 million. The company is the biggest exporter of beef in Western Australia and was previously the only one accredited to export to China[39] until August 2014.[40] Forrest acquired both Brick House Station and Minilya Station in 2015 for an estimated A$10 million, bringing his total pastoral holdings now to over 10,000 square kilometres (3,861 sq mi).[41]

SHARE
Previous articleHealth Benefits of Fruits

LEAVE A REPLY

Please enter your comment!
Please enter your name here